GST bill to be moved in Rajya Sabha next week

NEW DELHI: The government on Friday announced the constitutional amendment bill to facilitate a Goods and Services Tax (GST) will be brought to Rajya Sabha next week, triggering hopes of passage of the key legislation that will facilitate the most ambitious indirect tax reform since independence.

The Constitution amendment -the major test for the law's passage as it requires the support of two-thirds of members present and voting -is likely to be tabled in the House as early as Tuesday . “Almost all political parties are on board," minister of state for parliamentary affairs Mukhtar Abbas Naqvi said.

TOI had reported on Friday that the Congress leadership and the government were close to a deal on the GST law.

Hopes of the bill's passage have risen as the government has taken on board several con cerns aired by the states and some of the issues raised by Congress. The Centre is planning to back the legislation with a bill on central GST during the winter session of Parliament, paving the way for a rollout in April. The government has accepted the Congress's demand to scrap the 1% additional levy by manufacturing states such as Gujarat, Maharashtra and Tamil Nadu but has rejected the call for capping rates in the proposed legislation and has left dispute resolution to the GST council. The passage of the constitutional amendment bill will mark a big breakthrough for the Modi government as it will signal its determination to accelerate reforms that are intended to improve ease of doing business and make taxation more transparent.

Congress's resistance to the bill on the ground that it did not incorporate an 18% rate was a serious stumbling block that held up the legislation till the party agreed to drop the condition as long as the tax rate was “ring fenced“. The view of a majority of chief ministers that the tax rate should not be fixed in the Constitution amendment bill and that there should be adequate elbow room to alter the rate also weighed on the Congress leadership.

The meeting of the empowered committee of state finance ministers on Tuesday saw some states argue that an 18% rate may not prove to be adequate in terms of their revenue generation needs.

The political battle over GST bill has seen the numbers in RS slowly tilt towards the NDA and the process was accelerated by BJP's electoral win in Assam and strong showing in Kerala and West Bengal.

Congress's internal discussions also saw some acknowledgement that BJP's campaign that it was “obstructing“ the Modi government was costing the main opposition. In fact, the charge was helping BJP get away from a closer questioning of its own performance in office when it had crossed the two-year mark, felt some Congress leaders.

Earlier this week, the government approved amendments to the bill including clear language on the issue of compensation to states once the tax reform is rolled out. It has promised to compensate states fully for five years in the event of any revenue loss due to implementation of GST.

Implementation of GST has been pending for nearly a decade and has faced political roadblocks during this period.

Cong, BJP spar in RS over job generation

The simmering hostility between BJP and Congress once again boiled over in Rajya Sabha on Friday, with Congress MPs backed by other opposition members storming into the well to demand an apology from junior parliamentary affairs minister Mukhtar Abbas Naqvi during the Zero Hour. The uproar kicked off when an aggressive Naqvi, replying to deputy Congress leader Anand Sharma's remark that there was “despair among the youth“ due to lack of jobs despite all the promises made by PM Narendra Modi, said there was instead a sense of optimism in the country with jobs being created in every sector. But if there is “despair and disappointment“ in that party, the BJP could not help it. “There is no solution for it,“ said Naqvi.

Currently, the Goods and Services Tax (GST) is levied at 12 per cent on payments made for under-construction property or ready-to-move-in flats where completion certificate has not been issued at the time of sale.